Hi there,
Customer Loyalty
"It takes a lot less money to increase your retention of current
customers than to find new ones-but I know people don't give it as
much effort as they should because it does take a lot of energy and
effort!"
Strategize And Plan For Loyalty!
Do you even have a specific plan for building customer loyalty?
I bet you haven't given it as much thought as you should-
If you currently retain 70 percent of your customers and you start a
program to improve that to 80 percent, you'll add an additional 10
percent to your growth rate.
Particularly because of the high cost of landing new customers versus
the high profitability of a loyal customer base, you might want to
reflect upon your current business strategy.
These four factors will greatly affect your ability to build a loyal
customer base:
Products that are highly differentiated from those of the competition.
Higher-end products where price is not the primary buying factor.
Products with a high service component.
Multiple products for the same customer.
Market To Your Own Customers!
Giving a lot of thought to your marketing programs aimed at current
customers is one aspect of building customer loyalty.
When you buy a new car, many dealers will within minutes try to sell
you an extended warranty, an alarm system, and maybe rustproofing.
It's often a very easy sale and costs the dealer almost nothing to
make. Are there additional products or services you can sell your
customers?
Three years ago my house was painted, and it's now due for another
coat. Why hasn't the painter called or at least sent a card? It would
be a lot less expensive than getting new customers through his
newspaper ad, and since I was happy with his work I won't get four
competing bids this time. Keep all the information you can on your
customers and don't hesitate to ask for the next sale.
Use Complaints To Build Business!
When customers aren't happy with your business they usually won't
complain to you - instead, they'll probably complain to just about
everyone else they know - and take their business to your competition
next time. That's why an increasing number of businesses are making
follow-up calls or mailing satisfaction questionnaires after the sale
is made. They find that if they promptly follow up and resolve a
customer's complaint, the customer might be even more likely to do
business than the average customer who didn't have a complaint.
In many business situations, the customer will have many more
interactions after the sale with technical, service, or customer
support people than they did with the sales people. So if you're
serious about retaining customers or getting referrals, these
interactions are the ones that are really going to matter. They really
should be handled with the same attention and focus that sales calls
get because in a way they are sales calls for repeat business.
Reach Out To Your Customers!
Contact . . . contact . . . contact with current customers is a good
way to build their loyalty. The more the customer sees someone from
your firm, the more likely you'll get the next order. Send Christmas
cards, see them at trade shows, stop by to make sure everything's
okay.
Send a simple newsletter to your customers-tell them about the great
things that are happening at your firm and include some useful
information for them. Send them copies of any media clippings about
your firm. Invite them to free seminars. The more they know about you,
the more they see you as someone out to help them, the more they know
about your accomplishments-the more loyal a customer they will be.
Loyal Customers and Loyal Workforces
Building customer loyalty will be a lot easier if you have a loyal
workforce-not at all a given these days. It is especially important
for you to retain those employees who interact with customers such as
sales people, technical support, and customer-service people. Many
companies give a lot of attention to retaining sales people but little
to support people. I've been fortunate to have the same great people
in customer service for years-and the compliments from customers make
it clear that they really appreciate specific people in our service
function.
The increasing trend today is to send customer-service and
technical-support calls into queue for the next available person. This
builds no personal loyalty and probably less loyalty for the firm.
Before you go this route, be sure this is what your customers prefer.
Otherwise I'd assign a specific support person to every significant
customer.
One last thing-don't tell your customers your 800 line phone number is
for orders only! |
